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Reorganization Agreement

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Sectors: Services
Governing Law: Delaware, View Delaware State Laws
Effective Date: May 26, 2005
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Exhibit 10.4


Execution Copy


REORGANIZATION AGREEMENT

by and among


CONOCOPHILLIPS,

DUKE CAPITAL LLC


and


DUKE ENERGY FIELD SERVICES, LLC


Dated as of May 26, 2005


TABLE OF CONTENTS

Page
ARTICLE I CERTAIN DEFINITIONS ARTICLE II TRANSACTIONS Section 2.1 Initial Sale 17 Section 2.2 Second Closing Date Transfers, Contribution and Distributions; Restatement of LLC Agreement 17 Section 2.3 Empress Closing Date 17 Section 2.4 Authorization of Company Action 18 ARTICLE III THE CLOSING Section 3.1 Closing Place and Date 18 Section 3.2 Closing Date Deliveries 18 Section 3.3 Company Distributions 21 ARTICLE IV REPRESENTATIONS AND WARRANTIES OF COP Section 4.1 Corporate Organization 22 Section 4.2 Authority; Title; No Violation 23 Section 4.3 Consents and Approvals 24 Section 4.4 Permits; Compliance with Applicable Law 24 Section 4.5 Financial Statements and Information; Undisclosed Liabilities 25 Section 4.6 Broker' s Fees 25 Section 4.7 Absence of Certain Changes or Events 25 Section 4.8 Legal Proceedings 26 Section 4.9 Contracts 26 Section 4.10 Real Property 28 Section 4.11 Environmental Matters 29 Section 4.12 Intellectual Property 29 Section 4.13 Employee Benefit Plans 30 Section 4.14 Labor Relations 31 Section 4.15 Transactions with Affiliates 32 Section 4.16 Personal Property 32 Section 4.17 Insurance 32 Section 4.18 Public Utility Holding Company Act 32 Section 4.19 Sufficiency of Contribution 32 Section 4.20 Operatorship 33 Section 4.21 Residency 33 Section 4.22 Registration 33


i ARTICLE V REPRESENTATIONS AND WARRANTIES OF COMPANY Section 5.1 Corporate Organization 33 Section 5.2 Authority; Title; No Violation 33 Section 5.3 Consents and Approvals 34 Section 5.4 Broker' s Fees 34 Section 5.5 Legal Proceedings 34 ARTICLE VI REPRESENTATIONS AND WARRANTIES OF DUKE Section 6.1 Corporate Organization 35 Section 6.2 Authority; Title; No Violation 35 Section 6.3 Consents and Approvals 36 Section 6.4 Broker' s Fees 36 Section 6.5 Legal Proceedings 36 ARTICLE VII COVENANTS Section 7.1 Investigation of Business; Access to Properties and Records 36 Section 7.2 Consents and Approvals 37 Section 7.3 Further Assurances 40 Section 7.4 Conduct of Business; Restriction on Dividends 41 Section 7.5 Preservation of Business 42 Section 7.6 Public Announcements 42 Section 7.7 Assignment of Contracts, Leases, Permits, etc 42 Section 7.8 Corporate Names 44 Section 7.9 D&O Indemnification 44 Section 7.10 Expenses 44 Section 7.11 Insurance 44 Section 7.12 Guaranties 45 Section 7.13 Actions by Affiliates of the Parties 45 Section 7.14 Radio Licences; Radio Towers 46 Section 7.15 Post-Closing TEPPCO Adjustment 47 Section 7.16 Empress System Business Covenants 47 Section 7.17 Company Conduct 48 Section 7.18 Preparation of Financials 49 Section 7.19 Additional Covenant of Duke 49 ARTICLE VIII CONDITIONS TO CLOSING Section 8.1 Conditions to Duke' s Obligation to Close 50 Section 8.2 Conditions to COP' s Obligation to Close 50 Section 8.3 Conditions to Company' s Obligation to Close 51


ii ARTICLE IX TERMINATION ARTICLE X SURVIVAL; INDEMNIFICATION Section 10.1 Indemnification by Company 52 Section 10.2 Indemnification by Duke and COP 52 Section 10.3 Indemnification Procedure 53 Section 10.4 Survival 54 Section 10.5 Indemnification Limitation 55 Section 10.6 Materiality Qualifiers 56 ARTICLE XI EMPLOYEE MATTERS Section 11.1 Empress System Employees 56 Section 11.2 Canadian Assets Employees 60 Section 11.3 No Third-Party Beneficiaries 61 ARTICLE XII TAX MATTERS Section 12.1 Indemnification by COP with respect to Empress System 61 Section 12.2 [Intentionally Blank] 62 Section 12.3 Indemnification by Duke with respect to Empress System 62 Section 12.4 Indemnification by Duke with respect to Canadian Assets Business 62 Section 12.5 No Basket and Cap on Tax Indemnities 62 Section 12.6 Procedures for Tax Proceedings 62 Section 12.7 Filing Responsibility. 63 Section 12.8 Cooperation and Exchange of Information 64 Section 12.9 COP Refunds with respect to Empress System 65 Section 12.10 [Intentionally Blank] 65 Section 12.11 Duke Refunds with respect to Empress System 65 Section 12.12 Prompt Payment 65 Section 12.13 Survival 65 Section 12.14 Treatment of Indemnity Payments 66 Section 12.15 Tax Sharing Agreements 66 Section 12.16 Allocation of Certain Taxes. 66 Section 12.17 Predecessors and Successors 67 Section 12.18 COP Tax Representations with respect to Empress System 67 Section 12.19 Company Tax Representations with respect to Canadian Assets Business 68 Section 12.20 Tax Characterization of Transactions. 68 Section 12.21 Intentionally Omitted 71 Section 12.22 Canadian Tax Matters. 71 Section 12.23 Covenant of Duke. 71


iii Section 12.24 Coordination 72 ARTICLE XIII MISCELLANEOUS Section 13.1 Counterparts 72 Section 13.2 Governing Law; Jurisdiction and Forum; Waiver of Jury Trial 72 Section 13.3 Entire Agreement 73 Section 13.4 Expenses 73 Section 13.5 Notices 74 Section 13.6 Successors and Assigns 75 Section 13.7 Headings; Definitions 75 Section 13.8 Amendments and Waivers 75 Section 13.9 Schedules 75 Section 13.10 Severability 76 Section 13.11 Interpretation 76 Section 13.12 Specific Performance 76

Exhibits Exhibit A Termination Agreement Exhibit B Second Amended and Restated LLC Agreement Exhibit C-1 Assignment of Subject Company Equity Interests Exhibit C-2 Transfer of Equity Interests in Canadian Holding Company Exhibit D Empress Financial Statements Exhibit E Form of Transition Services Agreement Exhibit F Excluded Secondees Exhibit G Empress System Business Assignment Exhibit H Form of Condensate Crude Oil Purchase Agreement Exhibit I Form of Iso-Butanes Purchase Agreement Exhibit J Form of Normal Butanes Purchase Agreement Exhibit K Form of Extraction Agreement Exhibit L Form of Gas Supply Agreement COP Disclosure Schedule Schedule 1.1(a) Required Empress Consents Schedule 4.1(b) Organizational Structure of ES Transferor and Jurisdiction and Capitalization of PTC Schedule 4.2(b) Exceptions to Title and Liens Schedule 4.3 Consents and Approvals Schedule 4.5(b) Liabilities of the Empress System Business Schedule 4.7(b) Changes in Compensation Schedule 4.8 Legal Proceedings Schedule 4.9(a) Material Contracts Schedule 4.9(b) Defaults under Material Contracts


iv Schedule 4.10(a) COP-Owned Fee Properties Schedule 4.10(b) COP Leases Schedule 4.11 Environmental Liabilities Schedule 4.13(a) Employee Benefit Plans Schedule 4.14 Labor Relations (a) Empress System Employees (b) Collective Bargaining Agreements, etc. Schedule 7.2(e) Empress Licenses Schedule 7.4 Conduct of the Empress System Business (f) Capital Expenditures Schedule Schedule 7.12 Guaranties Schedule 7.14(a) Radio Licences Schedule 11.1(a) Multiple Offer Employees Schedule 11.1(d)(ii) DB Transfer Amount Methodology Schedule 12.18 Empress System Tax Representations Schedule 13.11 Knowledge Company Disclosure Schedule Schedule 7.12 Guaranties Schedule 7.14(d) Radio Licences Schedule 12.19 Canadian Assets Tax Representations Schedule 13.11 Knowledge Duke Disclosure Schedule Schedule 13.11 Knowledge


v

REORGANIZATION AGREEMENT (this " Agreement" ), dated as of May 26, 2005, by and among CONOCOPHILLIPS, a Delaware corporation (" COP" ), DUKE CAPITAL LLC, a Delaware limited liability company (" Duke" ), and DUKE ENERGY FIELD SERVICES, LLC, a Delaware limited liability company (" Company" ).


RECITALS

Company indirectly owned all of the Equity Interests (as such term is defined below) in Texas Eastern Products Pipelines Company, LLC, a Delaware limited liability company (" TEPPCO GP" ), which serves as the general partner of TEPPCO Partners, LP, a Delaware master limited partnership (" TEPPCO" ). Company and Enterprise GP Holdings L.P. (" GP Purchaser" ) are parties to a Purchase and Sale Agreement dated February 24, 2005 (the " TEPPCO Agreement" ) pursuant to which Company sold to GP Purchaser all of the Equity Interests in TEPPCO GP (the " TEPPCO GP Sale" and " TEPPCO GP Equity Interests" , respectively) and TEPPCO Holdings, Inc., an indirectly wholly-owned subsidiary of Duke, sold certain limited partner units in TEPPCO.


In connection with the TEPPCO GP Sale, Company made a bona fide loan to Duke (the " Duke Note" ) in an amount of $766,700,000, equal to 69.70% of the proceeds from the TEPPCO GP Sale, and a bona fide loan to COP (the " COP Note" ) in an amount of $333,300,000, equal to 30.3% of the proceeds from the TEPPCO GP Sale.

COP desires to increase its indirect ownership interest in Company to a 50% Percentage Interest (as such term is defined below). This increase in COP' s indirect ownership interest in Company, and the corresponding dilution in Duke' s indirect ownership interest in Company, is to be accomplished through the transfers, distributions and contribution and the amendment and restatement of the Amended and Restated LLC Agreement (as defined herein) described below.


Duke, indirectly through DEFS Holding (as such term is defined below), owns an Equity Interest (as such term is defined below) in Company which has a 69.70% Percentage Interest. Duke, through DEFS Holding, is willing to transfer to COP Transferee (as such term is defined below) a portion of such Equity Interest equal to an approximate 6.47% Percentage Interest in accordance with and subject to the terms and conditions set forth in this Agreement.

All of the proceeds received by Company from the sale of the TEPPCO GP Equity Interests are to be distributed 100% to DEFS Holding in accordance with and subject to the terms and conditions set forth in this Agreement.

Company, through various subsidiaries, owns all of the Equity Interests in Canadian Holding Company and is willing to distribute those Equity Interests to DEFS Holding in accordance with and subject to the terms and conditions set forth in this Agreement.

COP, through one or more subsidiaries, owns the Empress System Business (as such term is defined below) and is willing to transfer the Empress System Business to Duke Transferee (as such term is defined below) in accordance with and subject to the terms and conditions set forth in this Agreement.


1

NOW, THEREFORE, in consideration of the premises and the representations, warranties, covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties hereto hereby agree as follows:

ARTICLE I

CERTAIN DEFINITIONS


As used in this Agreement, the following terms shall have the respective meanings set forth below:

" $" shall mean United States Dollars.

" Actively Employed" shall mean, with respect to an individual and a specified date, that such individual is an employee of the relevant entity on such date and is either performing his or her regular occupation for his or her employer on such date (either at such employer' s usual places of business or at some location to which such employer' s business requires the employee to travel) or is on a previously scheduled and approved time-off, or such other leave of absence that would not have prevented such employee (if he or she had become a Continuing Employee as of the Applicable Closing Date) from receiving immediate coverage as of the Applicable Closing Date under the welfare benefit plans maintained by such individual' s employer that will be provided to Continuing Employees pursuant to the provisions of Article XI.

" Affiliate" shall mean, with respect to any Person, a Person directly or indirectly Controlling, Controlled by, or under common Control with such Person; provided, however, that for the absence of doubt, for periods after the Second Closing, neither Company nor any of its Subsidiaries shall be deemed an Affiliate of any member of the COP Group or the Duke Group.


" Agreed Terms and Conditions" shall mean, as to each Empress Commercial Agreement, general terms and conditions for such Empress Commercial Agreement that are mutually agreed to by COP and Duke pursuant to Section 3.2(b)(vi).


" Agreement" shall have the meaning set forth in the Preamble.


" Amended and Restated LLC Agreement" shall mean the Amended and Restated Limited Liability Company Agreement of Company, dated as of March 31, 2000, by and between Phillips Gas Company, a Delaware corporation, and Duke Energy Field Services Corporation, a Delaware corporation, as amended by the First Amendment to Amended and Restated Limited Liability Company Agreement of Company, dated as of August 4, 2000, and by the Second Amendment to Amended and Restated Limited Liability Company Agreement of Company, dated as of July 29, 2004, and as further amended, restated or supplemented from time to time until the Second Closing Date.

" Applicable Basket" shall mean (a) with respect to the Organizational Representations and Warranties, $25,000,000 and (b) with respect to the Business Representations and Warranties (i) relating to the Empress System or the Empress System Business, $5,000,000 and (ii) relating to the Canadian Assets Business or the Canadian Assets Subsidiaries, $7,000,000.

2

" Applicable Cap" shall mean (a) with respect to the Organizational Representations and Warranties, $197,000,000 and (b) with respect to the Business Representations and Warranties (i) relating to the Empress System or the Empress System Business, $41,000,000 and (ii) relating to the Canadian Assets Business or the Canadian Assets Subsidiaries, $52,000,000.


" Applicable Closing" shall mean (a) with respect to the Subject Company Equity Interest, the First Closing, (b) with respect to the TEPPCO GP Sale Proceeds Amount, the Equity Interests in Canadian Holding Company, and the Second Closing Cash Amount, the Second Closing, and (c) with respect to the Empress System Business, the Empress Closing.


" Applicable Closing Date" shall mean (a) with respect to the Subject Company Equity Interest, the First Closing Date, (b) with respect to the TEPPCO GP Sale Proceeds Amount, the Equity Interests in Canadian Holding Company, and the Second Closing Cash Amount, the Second Closing Date, and (c) with respect to the Empress System Business, the Empress Closing Date.


" Applicable Transferee" shall mean (a) with respect to the Empress System Business, Duke Transferee and (b) with respect to the Equity Interests in Canadian Holding Company, DEFS Holding.


" Applicable Transferor" shall mean (a) with respect to the Empress System Business, ES Transferor, and (b) with respect to the Equity Interests in Canadian Holding Company, Company.

" Asset Conveyance Documents" shall mean those agreements, assignments, assumptions, assignment and novation agreements, transfers, conveyances, deeds, bills of sale, share transfers, powers of attorney and other instruments necessary to transfer the Empress System Business to Duke Transferee, including the Empress System Business Assignment.


" Assumed Liabilities" shall mean the " Assumed Liabilities" as defined in the Empress System Business Assignment.

" Beneficially Own" shall mean, with respect to any Equity Interest, having or sharing the power to direct or control the voting or disposition of such Equity Interest, and " Beneficial Ownership" has a corresponding meaning.

" Beneficial Owner" shall mean, with respect to any Equity Interest, a Person who Beneficially Owns such Equity Interest.

" Business" shall mean the " Business" as defined in the Empress System Business Assignment.


" Business Day" shall mean any day on which banks are generally open to conduct business in the State of New York.


3

" Business Representations and Warranties" shall mean all representations and warranties set forth in Articles IV, V and VI of this Agreement (other than Organizational Representations and Warranties), in each case, to the extent relating to the Empress System Business, the Canadian Assets Business or Company, as applicable.


" C$" shall mean Canadian Dollars.

" Canadian Assets Business" shall mean the businesses historically and currently conducted by Canadian Holding Company and the Canadian Assets Subsidiaries, including the assets and Liabilities thereof.

" Canadian Assets Easements" shall mean pipeline easements, rights-of-way, licenses and land use permits of or used by the Canadian Assets Subsidiaries.


" Canadian Assets Employee" shall mean any individual who is an employee of Company or a Subsidiary of Company principally employed in the Canadian Assets Business, including each such employee who is seconded to Company, Canadian Holding Company or a Canadian Assets Subsidiary other than those secondees listed on Exhibit F.


" Canadian Assets Material Adverse Effect" shall mean a Material Adverse Effect on the Canadian Assets Business, Canadian Holding Company or the Canadian Assets Subsidiaries, taken as a whole.

" Canadian Assets Subsidiary" or " Canadian Assets Subsidiaries" shall mean all of the Subsidiaries of Canadian Holding Company.


" Canadian Cash" shall mean, for any given date, all Canadian Dollars and Canadian cash equivalents (or United States Dollars or cash equivalents or cash or cash equivalents of any other denominations) held by Canadian Holding Company or any Canadian Assets Subsidiary as of such date.


" Canadian Holding Company" shall mean Duke Energy Field Services Canada Holdings, Inc., a Delaware corporation as to which all of the Equity Interests therein are held directly or indirectly by Company.


" CFC" means Conoco Funding Company, a Nova Scotia company.


" Claim Notice" shall have the meaning set forth in Section 10.3(a).


" Closing" shall mean as to each Applicable Closing Date, the consummation of the transactions scheduled to close on such Applicable Closing Date in accordance with the terms of this Agreement.

" Code" shall mean the United States Internal Revenue Code of 1986, as amended.


" Commissioner" shall have the meaning set forth in the definition of " Required Governmental Consent."


4

" Company" shall have the meaning set forth in the Preamble.

" Company Disclosure Schedule" shall mean those Schedules to this Agreement identified as being part of the " Company Disclosure Schedule" in this Agreement (including the table of contents thereof).

" Company Plans" shall mean all material employee benefit, bonus, incentive, deferred compensation, stock purchase, stock option, severance, change of control, fringe benefit, pension, retirement, profit sharing, stock appreciation, health, welfare, dental, disability, life insurance and similar plans, programmes, arrangements or practices relating to any Canadian Assets Employees that are sponsored or maintained by Company or any of its Affiliates or to which Company or any of its Affiliates contributes or is obligated to contribute on behalf of the Canadian Assets Employees, whether funded or unfunded, written or oral, insured or self-insured, registered or unregistered.


" Company Retained Subsidiaries" shall mean all Subsidiaries of Company other than Canadian Holding Company and the Canadian Assets Subsidiaries.


" Continuing Canadian Assets Employee" shall mean each Canadian Assets Employee as of the Second Closing Date.


" Continuing Employee" shall mean a Continuing Canadian Assets Employee or a Continuing Empress System Employee.


" Continuing Empress System Employee" shall have the meaning set forth in Section 11.1(a).

" Contribution Agreement" shall mean the Contribution Agreement, dated as of December 16, 1999, by and among Duke Energy, Phillips and the Company, as the same may be amended from time to time.


" Contribution Date" shall mean the Closing Date, as defined in the Contribution Agreement.

" Control" shall mean the possession, directly or indirectly, through one or more intermediaries, by any Person or group (within the meaning of Section 13(d)(3) under the Exchange Act) of both of the following:


(a) (i) in the case of a corporation, Beneficial Ownership of more than 25% of the outstanding Equity Interests thereof, (ii) in the case of a limited liability company, partnership, limited partnership or venture, the right to more than 25% of the distributions therefrom (including liquidating distributions); (iii) in the case of a trust or estate, including a business trust, more than 25% of the beneficial interest therein; and (iv) in the case of any other entity, more than 25% of the economic or beneficial interest therein; and


(b) in the case of any entity, the power or authority, through ownership of voting securities, by contract or otherwise, to control or direct the management and policies of the entity.

5

" Controlled Group Liability" shall have the meaning set forth in Section 4.13(d).


" COP" shall have the meaning set forth in the Preamble.


" COP Canada" shall have the meaning set forth in Section 3.2(b)(v).


" COP Canadian Pension Plan" shall mean the ConocoPhillips' Pension Plan applicable to the Empress System Employees.

" COP Disclosure Schedule" shall mean those Schedules to this Agreement identified as being part of the " COP Disclosure Schedule" in this Agreement (including the table of contents thereof).


" COP Easements" shall have the meaning set forth in Section 4.10(c).

" COP Excess Canadian Cash" shall have the meaning set forth in Section 3.3(a).

" COP Group" shall mean COP and its Subsidiaries (other than Company, any Subsidiary of Company and PTC after the Applicable Closing).


" COP Indemnified Person" shall have the meaning set forth in Section 10.1.

" COP Intellectual Property" shall have the meaning set forth in Section 4.12(a).

" COP Leased Property" shall mean any real property demised pursuant to a COP Lease.


" COP Leases" shall have the meaning set forth in Section 4.10(b).


" COP Material Contracts" shall have the meaning set forth in Section 4.9(a).


" COP Note" shall have the meaning set forth in the Recitals.

" COP-Owned Fee Properties" shall have the meaning set forth in Section 4.10(a).

" COP Plans" shall mean all material employee benefit, bonus, incentive, deferred compensation, stock purchase, stock option, severance, change of control, fringe benefit, pension, retirement, profit sharing, stock appreciation, health, welfare, dental, disability, life insurance and similar plans, programs, arrangements or practices covering any Empress System Employees that are sponsored or maintained by COP or any of its Affiliates or to which COP or any of its Affiliates contributes or is obligated to contribute on behalf of the Empress System Employees, whether funded or unfunded, written or oral, insured or self-insured, registered or unregistered.

" COP Retained Affiliate" shall mean all Affiliates of COP other than PTC.


" COP Sale-Related Group" shall mean, collectively, ES Transferor and PTC; provided , that when used in Article VII, " COP Sale-Related Group" shall also mean each other Affiliate of COP that owns any or all of the Empress System Business at any time between the date hereof and the Applicable Closing Date.

6

" COP Sale-Related Material Adverse Effect" shall mean a Material Adverse Effect on the Empress System Business or PTC.


" COP Transfer" shall have the meaning set forth in Section 12.24.


" COP Transferee" shall mean CPGC.


" CPCL" shall mean ConocoPhillips Canada Limited, a Nova Scotia company.

" CPGC" means ConocoPhillips Gas Company, a Delaware corporation.


" CPGC Deficit Cash on Hand Amount" shall have the meaning set forth in Section 3.3(b).

" Damages" shall mean claims, liabilities, damages, penalties, judgments, assessments, losses, costs and expenses, including reasonable attorneys' fees and expenses, incurred by the party seeking indemnification under this Agreement, net of (a) any insurance proceeds which such party receives in respect of such matter net of any costs incurred by such party in the nature of increased insurance premiums or similar costs related to such recovery (determined on a reasonable present value basis) and (b) any indemnity payments (less costs of collection thereof) which such party receives from parties other than the party against whom such claim is asserted under this Agreement.

" DB Transfer Amount" shall have the meaning set forth in Section 11.1(d)(ii).

" Deficit Cash on Hand Amount" shall have the meaning set forth in Section 3.3(b).


" DEFS Holding" shall mean Duke Energy Enterprises Corporation (formerly Duke Energy Field Services Corporation), a Delaware corporation.

" DEFS Holding Excess Cash on Hand Amount" shall have the meaning set forth in Section 3.3(b).

" Designated Representatives" shall have the meaning set forth in Section 7.1(a).


" Direct Claim" shall have the meaning set forth in Section 10.3(a).


" Duke" shall have the meaning set forth in the Preamble.


" Duke Canadian Pension Plan" shall have the meaning set forth in Section 11.1(d)(i).

" Duke Disclosure Schedule" shall mean those Schedules to this Agreement identified as being part of the " Duke Disclosure Schedule" in this Agreement (including the table of contents thereof).


7

" Duke Energy" shall mean Duke Energy Corporation, a North Carolina corporation.


" Duke Group" shall mean Duke and its Subsidiaries (other than Company, any Subsidiary of Company, Canadian Holding Company (until the Second Closing) and any Canadian Assets Subsidiary (until the Second Closing)).


" Duke Indemnified Person" shall have the meaning set forth in Section 10.1.

" Duke Note" shall have the meaning set forth in the Recitals.


" Duke Transfer" shall have the meaning set forth in Section 12.24.


" Duke Transferee" shall mean one or more Subsidiaries of Duke designated by Duke ( provided that no more than one Subsidiary of Duke shall be the " Duke Transferee" for purposes of the transfer of the Empress System from CFC).


" Empress Closing" shall mean the consummation of the transfer of the Business and assumption of the Assumed Liabilities.


" Empress Closing Date" shall mean (a) provided neither Section 7.16(a) or (b) is applicable, the Empress Target Closing Date and (b) if Section 7.16(a) or (b) is applicable, the Replacement Empress Closing Date.


" Empress Commercial Agreements" shall mean:


(a) a Condensate Crude Oil Purchase Agreement incorporating the terms set forth on Exhibit H, any Agreed Terms and Conditions relating thereto and any other terms agreed upon by COP and Duke;

(b) an Iso-Butanes Purchase Agreement incorporating the terms set forth on Exhibit I, any Agreed Terms and Conditions relating thereto and any other terms agreed upon by COP and Duke;


(c) a Normal Butanes Purchase Agreement incorporating the terms set forth on Exhibit J, any Agreed Terms and Conditions relating thereto and any other terms agreed upon by COP and Duke;

(d) an Extraction Agreement incorporating the terms set forth on Exhibit K, any Agreed Terms and Conditions relating thereto and any other terms agreed upon by COP and Duke; and


(e) a Gas Supply Agreement incorporating the terms set forth on Exhibit L, any Agreed Terms and Conditions relating thereto and any other terms agreed upon by COP and Duke.

" Empress Contingency" shall have the meaning set forth in Section 7.16(a).


8

" Empress Financial Statements" shall mean (a) the proforma December 31, 2004, unaudited balance sheet of the Empress System Business (including PTC) and (b) the proforma unaudited income statement of the Empress System Business (including PTC
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